Poplar Bluff, MO, Feb. 25, 2014 (GLOBE NEWSWIRE) -- Southern Missouri Bancorp, Inc. (NASDAQ: SMBC, "SouthernMissouri"), the parent corporation of Southern Bank, and PeoplesService Company ("Peoples"), which is the 80% owner of PeoplesBanking Company ("PBC"), which is the 100% owner of Peoples Bank ofthe Ozarks, today announced the signing of a definitive mergeragreement whereby Southern Missouri will acquire Peoples in a stockand cash transaction. The minority shareholders of PBC willbe entitled to receive the merger consideration payable under theterms of the merger agreement. Peoples operates ten branches in Christian, Greene, Stone,Taney, and Webster counties in southwest Missouri. Eight ofthese branches are located in the Springfield, Missouri,Metropolitan Statistical Area (MSA). At December 31, 2013,Peoples' consolidated assets were $275 million, including loans,net, of $191 million, while deposits totaled $230million. Southern Missouri, following its February 21, 2014, acquisitionof Citizens State Bankshares of Bald Knob, Inc., Bald Knob,Arkansas (the parent corporation of Citizens State Bank), wouldhave reported total assets at December 31, 2013, of approximately$1.0 billion, including loans, net, of $760 million, and totaldeposits of $792 million, on a pro forma basis. After Southern Missouri's acquisition of Peoples, the combinedcompany's total assets will approximate $1.3 billion, with totalloans, net, of $951 million, and total deposits of $1.0billion. The combined company will operate 35 branches insouthern Missouri and northeast and north central Arkansas. Under the terms of the merger agreement, unanimously approved bythe boards of both entities, Peoples Service Company shareholderswill receive 0.3289 shares of Southern Missouri common stock and$10.90 in cash for each share of Peoples common stock, subject toadjustment based on Peoples' capital at closing. Based on theaverage closing price of $33.13 per share for Southern Missouristock over the most recent 20 trading days, the deal is valued atapproximately $22.9 million. As part of the merger, SouthernMissouri will also assume approximately $6.5 million insubordinated debt and retire $2.9 million in other debt.
"Southern Missouri Bancorp and Southern Bank are delightedto announce this merger with an organization having deep roots insouthwest Missouri," stated Greg Steffens, President and CEO ofSouthern Missouri. "We have great respect for Peoples Bank ofthe Ozarks, we're excited to welcome their employees to our family,and we look forward to serving their customers.""We have been interested for some time in expanding ourpresence in and around Springfield, Missouri," explained Steffens,"and we first began working towards that in mid-2010, with theopening of a loan production office in that market. We haveexperienced strong loan growth in what is now a full-servicefacility in Springfield, but this partnership provides a greatopportunity to build on that with Peoples' substantial retailpresence in the market." At December 31, 2013, loansoriginated out of Southern Missouri's location in Springfieldtotaled approximately $128 million. Todd Hensley, Chairman and CEO of Peoples, is expected to jointhe board of directors for the combined entity. "PeoplesService Company is the culmination of approximately 40 years of myfamily's involvement in the community banking industry," commentedMr. Hensley. "Southern Missouri Bancorp is a community-focusedpartner that can help us both leverage the strength of ourfranchise and continue to thrive in the ever-changing bankingenvironment. We believe the proposed combination will provideimproved service and product choices to our customers and evengreater opportunity to our associates. We feel this partnershiptruly offers a win-win result for everyone: our communities, ourcustomers, and our associates." "This transaction marks the most significant strategic move forSouthern Missouri during my tenure with the company, which began in1998" noted Steffens. "Our management team and board ofdirectors believe that every acquisition should make good financialsense for Southern Missouri shareholders, and in this instance, weexpect the transaction to be immediately accretive to earnings pershare, after transaction-related expenses, and to be accretive totangible book value after four years. Our investors may notethat this period is longer than we've been willing to accept inother transactions; however, we believe that the strategicopportunities this merger affords our organization will prove tomake it a wise investment."
Southern Missouri and Peoples anticipate completion of thetransaction in the third calendar quarter of 2014, subject tosatisfaction of customary closing conditions, including regulatoryand shareholder approvals, and consummation of an exchangetransaction involving the minority shareholders of PBC.Sandler O'Neill + Partners, L.P. acted as financial advisor andPatton Boggs LLP served as legal advisor to Peoples, while Silver,Freedman, Taff & Tiernan LLP served as legal advisor toSouthern Missouri. Conference Call: Southern Missouri will host a conference call on Friday,February 28, 2014, at 11:00 a.m., central time (12:00 noon, easterntime) to review the information provided in this pressrelease. The call will be available live to interestedparties by calling 1-888-317-6016 in the United States (Canada:1-855-669-9657, international: 1-412-317-6016). Telephoneplayback will be available one hour following the conclusion of thecall, through March 16, 2014. The playback may be accessed bydialing 1-877-344-7529 (Canada: 1-855-669-9658, international:1-412-317-0088), and using the conference passcode 10042047. Forward-Looking Information: Except for the historical information contained herein, thematters discussed in this press release may be deemed to be"forward-looking statements" within the meaning of the PrivateSecurities Litigation Reform Act of 1995 that are subject to knownand unknown risks, uncertainties, and other factors that couldcause the actual results to differ materially from theforward-looking statements, including: the requisite regulatory andshareholder approvals for this acquisition might not be obtained,the exchange transaction involving the minority shareholders of PBCmight not be consummated, or other conditions to completion of thetransaction might not be satisfied or waived; expected costsavings, synergies and other benefits from Southern Missouri'smerger and acquisition activities, including this acquisition andSouthern Missouri's other recently completed acquisitions, mightnot be realized within the anticipated time frames or at all, andcosts or difficulties relating to integration matters, includingbut not limited to customer and employee retention, might begreater than expected; the strength of the United States economy ingeneral and the strength of the local economies in which we conductoperations; fluctuations in interest rates and in real estatevalues; monetary and fiscal policies of the Board of Governors ofthe Federal Reserve System and the U.S. Government and othergovernmental initiatives affecting the financial services industry;the risks of lending and investing activities, including changes inthe level and direction of loan delinquencies and write-offs andchanges in estimates of the adequacy of the allowance for loanlosses; our ability to access cost-effective funding; the timelydevelopment of and acceptance of our new products and services andthe perceived overall value of these products and services byusers, including the features, pricing and quality compared tocompetitors' products and services; fluctuations in real estatevalues and both residential and commercial real estate marketconditions; demand for loans and deposits in our market area;legislative or regulatory changes that adversely affect ourbusiness; results of examinations of us by our regulators,including the possibility that our regulators may, among otherthings, require us to increase our reserve for loan losses or towrite-down assets; the impact of technological changes; and oursuccess at managing the risks involved in the foregoing. Anyforward-looking statements are based upon management's beliefs andassumptions at the time they are made. We undertake no obligationto publicly update or revise any forward-looking statements or toupdate the reasons why actual results could differ from thosecontained in such statements, whether as a result of newinformation, future events or otherwise. In light of these risks,uncertainties and assumptions, the forward-looking statementsdiscussed might not occur, and you should not put undue reliance onany forward-looking statements.
No Offer or Solicitation :This press release is being provided for informational purposesonly and does not constitute (i) an offer to purchase, nor asolicitation of an offer to sell, subscribe for or buy anysecurities, (ii) an offer to exchange any securities or (iii) thesolicitation of any vote for approval of any transaction. Thereshall not be any offer, solicitation, sale or exchange of anysecurities in any state or other jurisdiction in which such offer,solicitation, sale, or exchange is not permitted.
CONTACT: Matt Funke, CFO (573) 778-1800